"Thousands" of London flats to come to the market

westernpromise

wotsthat wrote: »

The only way to make the sums look better is if there's a big old crash and the HPC'er buys a much bigger house than they've been renting. Obviously begs the question is 20 years of living somewhere you don't want to live a worthwhile compromise? Plus, of course, there's the stress of being wrong for so long on top.

That doesn't work, though, because it makes the BCR lower only by comparing apples with oranges - a bedsit with a home. You could, conversely, make your BCR appear higher by renting a £10k a month luxury penthouse while waiting for the price of a £180k 2-bed newbuild in Northampton to fall. Nobody would accept that your BCR is then 1,000% because it's clear your alternative-to-buying cost - the penthouse - is overstated compared to your target property type - a chickenhouse.

There is in some people an old-fashioned view that there is a Presbyterian virtue in self-denial while saving up for something. This attitude simply has not absorbed the fact that a house bought now can save up for itself faster than you can.

wotsthat

westernpromise wrote: »

That doesn't work, though, because it makes the BCR lower only by comparing apples with oranges - a bedsit with a home. You could, conversely, make your BCR appear higher by renting a £10k a month luxury penthouse while waiting for the price of a £180k 2-bed newbuild in Northampton to fall. Nobody would accept that your BCR is then 1,000% because it's clear your alternative-to-buying cost - the penthouse - is overstated compared to your target property type - a chickenhouse.

You won't be scoffing when you find Crashy has invested 20 years of living in unpleasant digs, the mother of all crashes belatedly arrives and he buys Buckingham Palace.

cells

My current thinking is that for London there might now be quite a long period of stagnation. With potentially prices in 5-10 years no higher than today.

I spoke to a few estate agent today and they say the market for both lettings and sales has really slowed. One letting agent said they have seen a sharp fall in the number of European applicants which suggests they have already stopped coming.

I think the norm in London over the last few years was about 200,000 coming to London and about 100,000 leaving London each year. I don't expect a big fall in the number leaving London but the number arriving might crash in half in which case all the projections showing London to be 2 million more in 20 years will be wrong and we might find London doesn't pass 9 million let alone go to 11 million. That will of course be a massive difference to London in all respects especially Property.

buglawton

Typical British housing market, when demand falters, sellers decide to sit on their property rather than hold a fire sale.

Meanwhile a wall of Asian cash is approaching London to take advantage of the low £ - but it's smart money and they won't be looking for poorly-positioned £700k shoeboxes in mega-developments.

Crashy_Time

cells wrote: »

My current thinking is that for London there might now be quite a long period of stagnation. With potentially prices in 5-10 years no higher than today.

I spoke to a few estate agent today and they say the market for both lettings and sales has really slowed. One letting agent said they have seen a sharp fall in the number of European applicants which suggests they have already stopped coming.

I think the norm in London over the last few years was about 200,000 coming to London and about 100,000 leaving London each year. I don't expect a big fall in the number leaving London but the number arriving might crash in half in which case all the projections showing London to be 2 million more in 20 years will be wrong and we might find London doesn't pass 9 million let alone go to 11 million. That will of course be a massive difference to London in all respects especially Property.

Wishful thinking, I don`t think the property market really does stagnation, if it slows negative sentiment will see it slowing further and crashing. The way to lock in gains was to sell up before all this kicked off IMO.

Crashy_Time

buglawton wrote: »

Typical British housing market, when demand falters, sellers decide to sit on their property rather than hold a fire sale.

Meanwhile a wall of Asian cash is approaching London to take advantage of the low £ - but it's smart money and they won't be looking for poorly-positioned £700k shoeboxes in mega-developments.

You could jump up and down on your property shouting "HPI Forever!" but it won`t stop the price dropping when a neighbour sells for less, there will always be someone who needs to sell.

wotsthat

Crashy_Time wrote: »

You could jump up and down on your property shouting "HPI Forever!" but it won`t stop the price dropping when a neighbour sells for less, there will always be someone who needs to sell.

Fairly recent history suggests those who need to sell do so. Those that don't need to sell don't.

Then groovy gang on HPC will then start moaning about the deluded sellers and the lack of choice because only distressed or motivated sellers are coming to market.

Not much use to a buyer if prices fall 50% but there's nothing for sale.

Crashy_Time

wotsthat wrote: »

Fairly recent history suggests those who need to sell do so. Those that don't need to sell don't.

Then groovy gang on HPC will then start moaning about the deluded sellers and the lack of choice because only distressed or motivated sellers are coming to market.

Not much use to a buyer if prices fall 50% but there's nothing for sale.

At least you are coming round to the idea of a 50% fall. :money:


You know it makes sense.

wotsthat

Crashy_Time wrote: »

At least you are coming round to the idea of a 50% fall. :money:

You're under the illusion I'd like prices to rise - I don't.

50% off my next house (a big upgrade) would be great. The problem is I don't think it's going to happen and, as much as I'd like you to be correct, you very probably aren't.

Of course I want prices to fall for the sake of the children and because it's morally the right thing to happen. It's entirely coincidental that what I want to happen also happens to be the righteous path.

Your reasons are much more dignified - being able to laugh at the perma prop bulls whilst fearfully not buying in.

cells

wotsthat wrote: »

You're under the illusion I'd like prices to rise - I don't.

50% off my next house (a big upgrade) would be great. The problem is I don't think it's going to happen and, as much as I'd like you to be correct, you very probably aren't.

Of course I want prices to fall for the sake of the children and because it's morally the right thing to happen. It's entirely coincidental that what I want to happen also happens to be the righteous path.

Your reasons are much more dignified - being able to laugh at the perma prop bulls whilst fearfully not buying in.

What crashy and the other crash cheer leaders don't understand is that we have a finite number of properties to be allocated amongst the population
The best properties in the best locations will always go to the wealthiest

It doesn't matter what the price level is. A single crash cheerleader man on £26k a year isn't going to get what they would deem a nice house. Because there will always be much more capable bidders than a single man on £26k. For instance a couple on £26k. Or a person on a modest wage but with a huge inheritance. Or someone on more money than that. What they think of as the average buyer someone on £26k a year which is below the average full time wage will never get the above average property.


Its also worthwhile bearing in mind that in 2007-2009 while the whole world was going through a recession and a financial and banking crysis prices crashed a whole 10%. I don't expect the brexit recession to be global nor as bad as 2007-2009 so why would someone expect a crash 5x as big as 2007-2009?